A Poor Prescription for Drug Pricing

March 18, 2016

Prescription drug advertising has now been thrust forcefully into the Presidential debate. With each party’s candidates relentlessly trying to garner the spotlight through sound bytes on “taxes,” “security,” “immigration policy,” and the like, it unfortunately took almost no time at all for Direct-to-Consumer (DTC) advertising to make it into the rhetoric of the political season both on the trail and on the Hill.

DTC advertising of prescription drugs is now firmly entrenched in the debate on drug pricing and healthcare costs for consumers. Hillary Clinton in a campaign speech last fall called for “cracking down” on drug pricing by eliminating the tax deduction for DTC advertising costs and proposed FDA pre-clearance of these ads. Next, the American Medical Association’s House of Delegates approved a resolution to ban DTC advertising of prescription drugs and medical devices. The AMA argued that DTC marketing “inflates demand for new and more expensive drugs, even when these drugs may not be appropriate.”

Incumbents in Congress are starting to line up against DTC ads. In February, Rep. Rosa DeLauro (D-CT) sponsored legislation, HR 4565, to restrict DTC advertising of a new drug in the three years after the drug’s approval. Her bill even would allow the Department of Health and Human Services to ban outright new ads after this three-year waiting period if it so chooses. Also, Senator Al Franken (D-MN), along with three Democrat colleagues, introduced S 2623, a bill to no longer allow DTC advertising costs to be tax deductible as ordinary and necessary business expenses.

Legislators desperately want to seize this opening to attack DTC advertising either because they think drug marketing plays a detrimental role in drug pricing, or because they just don’t like what they see or hear in these ads. Both reasons are wrong and fail to justify an assault on prescription drug advertising. There simply is a lack of credible data showing that drug advertising is tied to pricing. More importantly, the First Amendment precisely exists to protect truthful commercial speech even if the government does not happen to care for the subject matter.

The First Amendment protects the right of all advertisers, including drugmakers, to advertise truthfully and nondeceptively to consumers and the Food and Drug Administration (FDA) has powerful regulatory tools to ensure the accuracy and balance of prescription drug ads. The Supreme Court clearly has defined standards for restricting commercial speech. In order for a ban on any form of advertising to be constitutional, the speech must be lawful and not misleading, the proposed regulation must directly advance a substantial government interest, and the restriction must be narrow and the government’s last recourse. U.S. Supreme Court Justice Sandra Day O’Connor, speaking for the Court in a prescription drug case, explained that the government may not invoke a ban on advertising just because it wishes to legislate or regulate. She wrote, “The Government simply has not provided sufficient justification here. If the First Amendment means anything, it means that regulating speech must be a last – not first – resort. Yet here it seems to have been the first strategy the Government thought to try.”

This is to say nothing of the fact that one of DTC advertising’s primary goals is to provide valuable information to patients about potential medical conditions that often could be life threatening or seriously debilitating. DTC advertising itself does not allow patients to self-diagnose or self-prescribe but rather asks patients to talk to their doctor, emphasizing the physician-patient relationship. At the end of the day, it is up to doctors to write the best prescription to meet the patient’s needs. Patients cannot on their own go to a pharmacy and walk out with a prescription drug.

There is no question that there are aspects of our healthcare system that could provide better quality and results to consumers, but going after advertising is not the way to deliver quality care to patients – especially at the expense of our fundamental First Amendment speech rights.